The fully funded method is a financing method for personal insurance and pension schemes in which capital for future benefits is invested on the capital market. In contrast to the pay-as-you-go method, the capital in the fully funded method earns interest over the term and can be paid out to the insured in the event of future claims (e.g. retirement, death). In Switzerland, the fully funded method is used, for example, for pension funds (2nd pillar), while the pay-as-you-go method is used, for example, for the AHV/IV (1st pillar).